The top three oil-dependent sovereign wealth funds have been selling European equity holdings since May, a study showed yesterday, another sign of petrodollars being withdrawn from world markets.
However, Asian funds have continued to add European equities, according to the data from Nasdaq Advisory Services, which provides analysis on shareholder and investor activity.
Since May, the Saudi Arabian Monetary Authority has sold US$1.2 billion worth of equities across Nasdaq’s European client base. That accounts for 13 percent of its US$9.2 billlion holdings in the European companies tracked by Nasdaq.
Norway’s Norges Bank Investment Management has sold US$1.1 billion — around 2 percent of the US$57.5 billion market value of its holdings.
The Abu Dhabi Investment Authority has cut about US$300 million worth of shares from its US$3.6 billion holding.
“Over 2015, the three largest oil-dependent SWFs [sovereign wealth fund’s] have all been reducing their equity holdings in the region, with this trend accelerating over the second quarter and into the third quarter of the year,” Nasdaq Advisory Services analyst Alexander Free said.
The data is based on a sample of 159 European companies, with a market value of US$1.87 trillion, Nasdaq said.
They range from retail and telecoms shares to financials and utilities.
Falling oil prices — with Brent crude down over 60 percent since summer last year — has put pressure on oil producers to rein in spending or liquidate assets.
Energy-exporting countries pulled money out of world markets last year for the first time in almost two decades, halting the “recycling” of oil windfalls, BNP Paribas has said. The trend would continue as energy prices stayed under pressure, the bank said last year.
In July, Saudi Arabia resorted to issuing a bond for the first time since 2007. The IMF has warned of the Saudi deficit — estimated at about 20 percent of GDP this year.
The Saudi central bank, which serves as the wealth fund of the world’s top oil exporter, has been drawing down its reserves since late last year.
Its net foreign assets fell by US$6.6 billion in August as the Saudis liquidated assets to plug the budget gap .
“It’s a pretty dire situation,” Free said.
Norway has announced it is to make its first net withdrawal from its sovereign fund since it was set up, to help pay for tax cuts designed to stimulate the economy.
Its US$830 billion fund is the world’s largest, holding about 1.3 percent of global stocks.
In contrast, the three biggest non-commodity driven sovereign funds have been net buyers of European equities — particularly China’s SAFE, which holds about US$35.6 billion worth of the Nasdaq sample.
SAFE started buying heavily in Europe from the first quarter of this year, acquiring US$2.1 billion of the shares tracked by Nasdaq. Singapore’s Temasek and GIC have also acquired a combined US$1.1 billion of European equities so far this year, Free said.
He suggested their interest might stem from a search for better valuations as US equity prices surged to pre-crisis levels, while the European Central Bank’s money-printing program also lent support.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day